A Few Things: Global Food Supply, The Battle for Ukraine, Private Markets Review, Opportunities in Commodities, Programmable Money

March 25 2022

I am sharing this weekly email with you because I count you in the group of people I learn from and enjoy being around.

“A good plan violently executed now is better than a perfect plan executed at some indefinite time in the future.”

- George S. Patton Jr.

“Our lives are fashioned by our choices. First we make our choices. Then our choices make us.”

- Anne Frank

“Everyone thinks of changing the world, but no one thinks of changing himself.”

- Lev Tolstoy

If you missed last week’s email, it’s here.

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A. A Few Things Worth Checking Out:

1. I’m worried about global food prices and food stocks.

The Bloomberg Odd Lots podcast had a deep episode discussing: A Historic Disruption To The World’s Wheat Supply.

Bottom line: we will have serious food shortages across emerging markets.

2. Peter Zeihan was on the Hidden Forces Podcast discussing The Battle for Ukraine & Prospects for World War III. I listened to this twice.

Bottom line: Russia will keep going, so it’s key to draw the line in Ukraine. Either way Russia’s oil is going away, China most likely to be most hurt by this. Unclear whether we are dealing with wholly rational players in Xi and Putin, since they are so isolated and disconnected from information.

3. McKinsey published its 2022 Global Private Markets Review. Worth a flip through, here are some charts I liked.

4. Howard Marks released his latest memo this week, “The Pendulum in International Affairs” which can also be listened to via podcast.

Bottom line: we are going to witness a huge swing from globalisation to de-globalisation.

5. Gaurav Kapadia of XN Capital was on Invest Like The Best. Gaurav rose to be a partner at TPG Axon, co-founded Soroban Capital, and his decision to launch XN in 2020.

This is a discussion on how to compound everything and what it takes to succeed in public markets today.

6. Leigh Goehring and Adam Rozencwajg of Goehring & Rozencwajg Associates were on the Grant’s Current Yield Podcast discussing Opportunities in Commodities.

Goehring & Rozencwajg also had a great Q4 letter in February discussing what they are seeing across Commodity markets, some charts:

We continue to believe that a global agriculture crisis is about to engulf us. Strong grain demand, combined with changing weather patterns, will force grain prices significantly higher as we progress through this decade—a process that has already begun. 

On the supply side, we believe the extremely favorable crop growing conditions experienced over the last 30 years could very well be changing--- with huge implications. The consensus opinion continually presses the point that global warming and climate change will bring forth near apocalyptic conditions to the world’s grain belt. We firmly believe that global warming trends over the last 30 years have been the only way the world could accommodate a 75% jump in grain demand. Although no one wants to admit it, global warming has fostered propitious growing conditions which has enabled crop yields to steadily increase upwards.

7. Why Global Supply Chains May Never Be The Same, from WSJ. A deep video discussion and analysis on our global, complex, fragile supply chains. Thanks Max Leclerc. I learnt a ton.

8. My friend Diana Chambers just published a great note on Understanding Trauma as a Key to our Financial Behaviour. A lot here to think about and absorb.

9. We’re at the end of Q4 letter season and there’s a rich repository of letters available on Reddit.

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B. The Tech and Crypto Section:

1. The Latecomer’s Guide to Crypto, written by Kevin Roose in the New York Times. This is a simple, jargon and bias-free analysis on all things Crypto.

2. Blockchain and crypto will change our relationship with money and more specifically value transfer. This was a great discussion on Programmable Money by an entrepreneur building a great business. Thank you Yaser.

3. ExxonMobil is using excess natural gas to power crypto mining.

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We have been binging on The Dropout, the Thernaos story based on John Carreyrou’s book.

It’s a crazy story.